Quantum, Inc. has warrants outstanding that allow the holder to purchase 1.5 shares of stock per warrant at $30 per share (exercise price). Thus, each individual share can be purchased at $30 with the warrant. The common stock is currently selling for $36.
The warrant is selling for $12.
a. What is the intrinsic (minimum) value of this warrant?
b. What is the speculative premium on this warrant?